Southwest Airlines' Organizational Culture

Southwest has been profitable every year for 31 years since it started its operations in 1971. During this period most airlines have struggled to achieve three or four years of consecutive profitability. In 2002, the total market value of Southwest was $9 billion, larger than that of all the other major airlines in the US put together (Refer Exhibit I). The airline achieved high levels of employee satisfaction and was included in the Fortune magazine's list of the "100 Best Companies to Work for in America" for three years in a row. Many analysts feel that the remarkable performance of Southwest is because of its ability to build and sustain relationships characterized by shared goals, shared knowledge and mutual respect between employees.

They wanted to provide the best service with the lowest fares for short-haul, frequent-flying and point-to-point 'non-interlining'² travelers. Herbert D. Kelleher, (Kelleher), who was the legal advisor to King's air service, later joined them to start the airline company. The trio decided to commence operations in the state of Texas, connecting Houston, Dallas and San Antonio (which formed the 'Golden Triangle' of Texas). These cities were growing rapidly and were also too far apart for travelers to commute conveniently by rail or road. With other carriers pricing their tickets unaffordably high for most Texans, Southwest sensed an attractive business opportunity.